The age of the customer demands a different approach

The combination of technological changes in the internet, mobility and social media is changing the way customers buy. The only sustainable competitive advantage moving forward is to know your customers better than they know themselves and to engage with them in a buyer-aligned way. This brings new requirements to our sales process.

Research by Forrester shows that 74% of executive buyers, once they commit to making a change, will go with the company that’s able to help create the buying vision. And hence, sales changes from a push to a pull strategy. Sales now has to facilitate the buying process based on the strengths of their offering and the impact it will deliver for the customer. So a lot of companies are re-evaluating their current sales and marketing approach. And it’s no surprise that they tend to have some common questions:

Is my current sales process appealing to the better informed customer?

All vendors tell me their sales method is aligned to the buyer journey. How do I know if this is true? How do I choose the right one?

Critically important questions

Answer the questions correctly and you’ll deliver the results shown in a recent study by the Sales Management Association. They found a 28% higher growth rate for companies using a buyer journey-based sales methodology, along with lower sales costs and improved margins.

But get the answers wrong and you’ll have the opposite:

Worse relationships with prospects and customers. You’ll even alienate them.

Below you’ll find the three most critical evaluation criteria when selecting a sales process/methodology.

1. Pseudo buyer alignment versus real buyer alignment

You can typically recognise companies offering a Pseudo Buyer-Aligned Process by the following:

They translate the buyer process into a sales process. So first they analyse a customer buying process and then superimpose a second process that has the corresponding sales process steps to take for every step of the buying process. They claim that because the steps of the sales process are aligned with the steps of the buying process, they have a buyer-aligned sales process.

It is a linear process that is identical for all opportunities.

This is not only wrong, but so theoretical and complex that the sales force find it impossible to implement with a high adoption rate. Consider a simple analogy: in the spring we plant seeds to align our farming activities with the season. But planting seeds does not mean that therefore it’s spring. You have to monitor the seasons and align the farming activities accordingly. You don’t monitor the farming activities and then deduce that the season is aligned.

When salespeople follow a Pseudo Buyer-Aligned Sales Process they make the same fatal assumption. They assume that since they executed this step of the buyer-aligned sales process, the customer will now move to the next stage of the buying process. Can you see how this is completely wrong? Their reference points are the steps of the buyer-aligned sales process, instead of those of the customer buying process.

Beware of a sequential set of steps

The second problem with this approach is that the Pseudo Buyer-Aligned Sales Process is a sequential set of steps:

You take a step

Finish it

Check box

Done

Next step

In contrast, the buying process is neither linear nor sequential. It is a dynamic and iterative process, which means that the customer goes back and forth within each stage of the buying process. So even if your sales process includes customer milestone checkpoints when passing from one stage to the next, it still doesn’t work in reality. Because the customer may say one thing one day and then something else another day. How many times have you had a meeting where the customer was enthusiastic about something you said but then changed their mind at the next meeting. Why? It’s very simple. Customers do not live in isolated worlds. After your meeting they talk to peers, they go on the internet, they talk to colleagues. This influences or even completely changes their opinion.

Online information influences 71% of decision criteria

Recent research by SiriusDecisions shows that online information influences 71% of customer decision criteria and their buyer journey. Sales reps need to be able to see how their customer evolved since the last meeting. Contrast this with a salesperson who follows the pseudo buyer-aligned linear sales process: “I did step A of the process, so now I need to do step B?” But who says so? Who says that because you executed your step that the customer also evolves? And if so, who says the customer didn’t change their mind or wasn’t influenced by others since your last contact? Your sales force needs to be focused on the customer buying process and adapt their behaviour accordingly.

Therefore, implementing the sales steps in your CRM won’t help. Even if you align them with a generic buying process. Your salespeople will focus on those sales steps and lose track of the buying process. What you need to do is to implement the buying process stages and tools to continuously monitor buying readiness.

Check: ask your sales to show and explain their sales process and a screenshot of a CRM implementation.
If you see sales stages and/or a linear process, you know you have a Pseudo Buyer-Aligned Process.

2. Company buyer journey versus individual buying readiness

As we learned in the previous point, we need to detect the buying stages and align activities accordingly. Not the other way around. That being said, there is another dimension to this that makes this even more critical. Each member of the decision making unit (DMU) is going through the buyer journey at their own pace, dynamically and iteratively. Each person is influenced in many ways and could potentially be involved in another stage of the buying process.

Misalignment of the sales activity with individual buying readiness will result in a longer sales cycle and a lower win probability. So there’s no need to explain why you need to install a process that enables you to monitor individual buying readiness and/or alignment of the DMU. Implementing a company buyer journey doesn’t help because it doesn’t exist. Every company has a unique buyer journey, with stages that include:

Definition of requirements

Evaluation of vendors

Short list of vendors

Negotiation with short list

As you can see, these stages are very high level and company-based. They don’t allow you to monitor individual buying readiness, which means your sales force won’t be able to individually align and influence DMU members. Many initiatives from top management stall because people lower down in the organisation were not ready to buy. If we want to win deals, we need to identify these individual misalignments and have the right sales and marketing activity in place to resolve these friction points.

Check: does your sales methodology take individual alignment into account? Ask to see the sales process. If it shows general buying stages, you won’t be able to focus your sales on aligning DMU members.

3. Is your sales process multicultural?

There is a big difference between European companies and US-based companies. Most sales methodologies developed in the US fail in implementation in European and global companies. The US has a ‘hero culture’, where the CEO, VP Sales and people delivering results are heroes. This has a totally different impact on the way sales reacts to or views top-down implementations and rule-based ways of working. In Europe, the fact that top management says something can actually have the opposite effect on salespeople.

Here’s a simple test to define the culture: count how many sales people are using individual spreadsheets – a feature of the hero culture. The methodologies of US-based companies are using this hero paradigm. So in all the intricacies of the method you buy, you will find all kinds of resistance to adopting it from your sales force.

Check: is your methodology based on multicultural diversity?
If not, be prepared for resistance.

These three requirements are crucial if you want to implement a sales process that will truly align your reps with the new buyer and that the team will adopt and use.

Every day we’re being confronted with increasing sales costs and margins under greater and greater pressure. In this blog, we explain why this is happening and look at the solution in detail.

Increasing sales costs and greater pressure on margins are usually the result of inadequate or non-existent internal sales training and supervision. There are also a few die-hard habits that many companies and sales reps cling on to which can cause even bigger problems for sales performance.

Directors will already be familiar with the changed buying behaviour and understand the impact it has on their sales and marketing organisation. The fact that up to 75% of decision-making criteria are influenced online means it’s important for us to allow sales to start a dialogue with customers at different times and with different messages.

If sales is forced to wait until customers are ‘ready-to-buy’ or in the quotation stage before they spring into action, it’s impossible to sell customer value, so:

Margins continue to fall

Products and services are experienced as commodities

This habit comes from:

Managers being mainly interested in the time frame that deals are agreed in

Sales who think it’s a waste of time to enter into a buying process early, and prefer to wait for ready-to-buy leads from marketing

Sales who are willing to start the buying process early and influence the customer, but don’t have the necessary skills and messages to appeal to customers in this early stage

The solution: do the right thing at the right time with the right personManagement behaviour and how to direct sales teams is crucial here, although that’s a separate topic just in itself. But how can we arm sales to face these new challenges?

Train sales to detect and facilitate the entire buying process

Implement a sales process that allows your team to document opportunities based on the customer’s willingness to buy (buying process) – and embed this in the CRM

Document messages for each product-market combination, and teach sales to use these messages at the right time in their comfort zone using ‘how to sell’ training with role plays

The buying process in figure 1 shows the complete customer journey. Whether it’s for existing or new customers determines how sales deals with it.

For existing customers, sales mainly need to convey ‘why customers need to stay’ – combined with behaviour that we label as ‘account development’ rather than ‘account management’. With existing relationships, detailed knowledge of the customer and their environment provides a great opportunity for increasing the value perception, and so embedding the relationship more deeply.

For non-customers, the first question is: ‘Has the customer already decided to change?’ Has the customer not decided to change yet? Then it’s best to base your messages and interactions on breaking the status quo, and so increasing the willingness to change. Customers aren’t usually aware of what improvements are possible. Or the customer thinks the risks that come with the change look too big. Or they’re not familiar enough with exactly what’s required.

These ‘why change’ messages assume the customer’s point of view and are the best way of developing prospects. And this is where the biggest challenge is identified in terms of sales performance. Various studies and analyses of our customers show that up to 60% of opportunities simply disappear from the forecast without any decision being made by the customer. The biggest competitor isn’t another supplier, but the customers themselves simply not deciding to buy anything. So messages about how good your company and its solutions are, or the extra benefits that you can offer, won’t help stimulate the buying process.

Has the customer already decided to buy? Then the next question is of course: who should I buy what from, and how much for? Sales responds to this with messages that underline why the customer should choose them. These ‘why us’ messages are most effective at this point in time. Most companies and a large proportion of sales reps score quite to very highly in this area.

Figure 2 shows when these three types of messages are most effective from a sales perspective

In summary, we therefore need to enable sales to convey three different types of messages convincingly according to the situation and depending on the product-market combination:

Why change

Why choose us

Why stay with us

How much do your sales convey these three sets of messages? And to what extent can they discuss them with the customer at the right time? You can compare your sales performance and customer orientation with best in class companies in the Sales Performance Benchmark

The Empowered Buyer has unleashed a range of new productivity challenges. Sales cycles have become longer and more complex than ever before. This becomes painfully clear in the declining number of sales reps still making quota: only an alarming 57,1% according to CSO Insights. One of the major productivity challenges we see, is complexity in the sales conversation.

Now let’s have a closer look at conversation complexity. Imagine you are a multi-product B2B company and John, one of your sales guys:

is selling into FMCG and pharmaceuticals

needs insights into each vertical; think of typical challenges, objections and competitive arena’s

in each of the verticals, he will be talking to 3 or more profiles, all having different reasons to buy

John has to guide each profile through different buying phases, each phase requiring typical answers and types of information

and last but not least: he needs to fit all the above with the right products from his portfolio

_________________________

Bottom line: John has a couple of thousands of conversations to manage!

Many companies really do expect their sales teams to familiarise with such inhuman amounts of information. And besides knowledge, don’t forget that reps need the capability to inject just the right content into the conversation at the right time, to the right person.

Now raise digital hands: can we agree that this is a mission impossible? Nobody can learn to handle this type of complexity. Sales reps are no robots switching seamlessly from one situation to the next every hour of the day. It is time we look for alternatives to support sales.

Overcoming the sales learning curve

So what can we do to get John and his colleagues back on track, and stop the year over year quota erosion? Here are 5 problem area’s:

1. 70 % of marketing content remains unused by sales
At the same time, sales reps spend 30 hours per month looking for or creating relevant content, while spending only 22% of their time actively selling. This demands first of all for a system to measure which materials are (not) being used by sales, and when. From there, marketing collateral needs to be aligned with sales conversations

2. Even Messi never stops training. So why would sales?
Traditional training is typically done in bursts of a couple of days a year. Whereas research by the Institute of America shows that 58% of training contents are forgotten within 30 minutes. Another 33% is lost after 48 hours. And by the time that theory has been put into practice, typically 3 weeks later, learning retention has been reduced to 15%. So why not shift to continuous learning by adding content training to their mobile in small nuggets, focused on individual needs? We call this ‘snackable’ learning

3. Over 80% of buyers say vendors don’t understand their issues
Closely related to the previous point, sales training and support collateral are mostly still focused on company solutions and product benefits. Buyers today are hyper connected and empowered via online and social collaboration. They don’t need your sales to explain products and services. But what they do want, is a trusted partner and advisor to help solve critical business issues

4. Most management practices have their own set of ground rules
Most management practices – like engineering or accounting – have their own set of ground rules. Imagine the drama if we took balance sheets away from financial reporting! Yet, sales management doesn’t have any ground rules or common management practice to fall back on. Instead, we are reinventing the wheel. And in many cases, we don’t even have a sales management practice behind

5. The competitive, individual (non collaborative) culture we see in most sales teams
Sales meeting agendas are still driven by business updates and reviews. Let sales become a team sport and turn sales meetings into experience sharing events. Ask marketing to join in and keep sales support materials aligned and up-to-date. You will cultivate an experience sharing culture

It would take us too far in this blog post to draw out answers for all the above. But we have done so in a webinar together with Vlerick Business School. It will take you through the 5 components to support an effective team – in less than an hour! Boost the conversation, and the sales results:

Are you thinking about implementing a new sales process, but you cannot separate the wheat from the chaff? There are theories that may sound nice but do not work in practice and thinking in terms of complex, modern or simple does not always guarantee quality. A sales process is difficult to impose, it needs proper implementation.

Questions you must ask yourself for every sales model

The following weeks I will guide you through several known processes and I will discuss a few criteria you should take into account. For a start: the sales model that has almost become a classic.

This is not about the customer

It is clear that this is a linear process. Your salespeople will immediately see that this sales process representation is old-fashioned and simplistic and does not reflect reality. Your sales team offers resistance and rightly so, because this process does not enable them to properly assess, follow-up or report the customer’s situation. A good salesperson will do what they have to do and will enter a status based on individual interpretation. Mostly, CRM is somewhat outdated because the salesperson does not benefit from it.

It is a rigid model with little room for variation. Moreover, it forces the salesperson to report from his/her own activities. As a result, the management cannot properly evaluate the customer’s situation and it is impossible to provide coaching to guide the salesperson accordingly.

Meaningless

The process starts from your own activities and therefore does not depend on the market or the product complexity, which seems really interesting. However, it is so meaningless that it hardly improves the functioning of your company in the end. It is true that this linear step-by-step plan is simple and easy to remember, but due to this oversimplification the process is not applicable in reality.

Too little information is available, so that additional fields in CRM will probably be created so as to compensate this inadequacy. If you work with this model, you have to work with visit reports. Such reports are very time-consuming and do not allow structured reporting.

Not recommended

We can only advise you against working with this model. It increases the administrative burden, is impossible to maintain in reality and will jeopardise good collaboration between your different departments. Your salespeople will be frustrated and will not meet their quota.

To remain competitive and successful, companies need to tailor their sales and marketing processes to the behaviour and expectations of customers and prospects. This can also be done by introducing new processes which create demand and support sales enablement. What should you pay attention to during this transformation?

The following seven recommendations help you on your way. They originate from SiriusDecisions and are the result of their market research and the shared experience of hundreds of companies. They were recently presented by John Neeson at a seminar that we organized with our marketing business partner LeadFabric. I was the next speaker and I took notes of his explanation. Here are the recommendations:

Examine where your company is today

Take enough time to find out where marketing communication can make a better contribution at your company. Determine the buyer’s journey. Your marketing campaigns need to act on this buyer’s journey, and your staff need to understand it. Pure lead generation actions will be of insufficient help; ensure a varied and integrated marketing mix.

Provide sufficient operational capacity

Do you have the appropriate means and software to measure your sales and marketing processes? Are you able to collect information on your customer’s needs and how you can help him?

Create focus

Take a look at the sales organisation and align it to the journey that buyers take through their buying cycle. This is the best way to achieve your business strategies and objectives.

Measure and report

Measuring is crucial. If you know where your leads come from, you can align your marketing processes and your content to this. Automate your marketing campaigns and build a KPI dashboard that enables external reporting. Only by measuring can you find out more about your customer and improve your processes on a continuous basis.

Share the same targets

The marketing and sales departments must have the same objective in mind. What matters most is not the amount of leads but their quality and the way you deal with them. Determine how marketing can contribute to the pipeline and link individual performance indicators to the business and sales objectives. Do not wonder how marketing can generate more profit, but ask yourself to what extent marketing contributes to the creation of opportunities. The marketing division serves to support this process and to generate demand.

Know your customer

Acquaint yourself with the buyer through personas and buyer’s journey maps. This enables you to perfectly cater to the customer’s needs at any stage of his purchasing process.

Buying behaviour has fundamentally changed over the past ten years. But there are still lots of companies approaching buyers of today with outdated best practices and mindsets, or continuing to advocate the old way of selling.

Until recently, it was still possible to achieve reasonable B2B sales results by simply highlighting a solution’s benefits. Clients had no alternative but to take the sales person’s advice when making their buying decisions. People who still have this mindset should beware: buyers have taken over the sales process, and now they have power. And they want to run as few risks as possible.

How can we adapt to today’s buyer?

A lot has already been said about the switch from product sales to solution sales, or from transactional into consultative selling. But we still see that neither has delivered on its full potential, and results remain far below expectations. This is why:

Both aim to implement a repeatable, linear and mechanical step-by-step process (not a ‘real’ sales environment!)

The sales support environment is not upgraded simultaneously; bonuses, product training and literature, events, CRM and even reporting remain largely unchanged

Management tries to resolve this with sales skills training and there is no change programme

You can fix this by focusing on the buyer, and learning about your clients and their markets.It’s also important to factor in risk mitigation. The ‘customer trust equation’ by David Maister, one of the world’s leading authorities on the management of professional service companies, is an excellent formula for clarifying the idea of risk mitigation:

T = (C+R+I) / S

T: trustworthiness (or perceived risk of working with you)

C: credibility = words (I can trust what he says)

R: reliability = actions (I can trust him to …)

I: intimacy = emotions (I feel comfortable discussing the subject)

S: self-orientation (I can trust that he cares)

The denominator of this fraction is (of course) what has the biggest impact here. You have to convince your clients that you really understand their requirements and objectives. The conversion rate will be lower if the client thinks the seller is focussing on themselves, regardless of the quality of your products or your sales person’s knowledge. In this case the seller is not being driven by the client but by a bonus that depends on the deal being struck, the internal pressure of a forecast, the special offer they want to sell, management’s desire to sell more of these solutions, or the belief that they’re an expert and want to prove it to you.

So consider risk management and look at all the conditions that can have an impact on sales when deciding how to improve your sales performance.

Solution Selling is very common jargon used in sales organisations. Companies that have introduced this method have gained a competitive advantage as a result of the way in which sales people help customers with their purchases.

This is how you sell solutions:
– Discuss client needs using open questions, creating a vision and a solution together with the client. This gives the seller the greatest possible impact on what the client will ultimately buy.
– The packaging of products and services in such a way that a total solution is created to satisfy client needs. The classic example is Apple with iPod and iTunes in contrast to a normal MP3 player.

Trend reversal: more power for the client

The internet and social media have brought about an important shift in the way people are informed and how they make their purchase decisions. But in the last couple of years we have seen a trend reversal which has undermined the impact of Solution Selling. Now the client has the power. It’s no longer the sales process that counts; the purchasing process (buyer journey) now has the upper hand. Welcome to the Age of the Customer. Client interaction and sales discussions have to be different now to achieve good results.

Not just information, but conversation

You can still achieve a sustainable and competitive advantage in this new era – the Age of the Customer. But now your client knowledge forms the basis for the development of new products and services to satisfy the increased needs of better informed clients. Your marketing and sales don’t provide information so much anymore; instead they provide conversation to improve your client relationships with more engagement. A better experience and the proven impact of your solution will result in a higher margin and lower sales cost.

Difference between Solution Selling and Buyer-Aligned Selling

SOLUTION SELLING

BUYER-ALIGNED SELLING

What is the starting point?

As a consultant, make it possible to discuss requirements and guide the client in their thought process until the specific solution is bought.

Ability to question client beliefs and provide support by completing the picture.

Which process is required?

Your entire sales organisation using a proven sales process. All your activities and measurement systems must chart and improve its effectiveness and application.

A dynamic buying process based on customer experience. Enable employees to adapt to the buyer’s phase of purchasing at any moment. Internal processes and measurement systems are designed to match the buying phase.

What’s important?

Ask the right questions to discuss the challenges that can be resolved by the solution you are offering. The strengths must be explicit and demonstrable from the structure of the approach.

Empathy with the client situation and use of language specific for the role and sector. This demonstrates an attitude which shows that helping the client is your highest priority.

What knowledge is crucial?

Knowing the relationship between the client’s challenge and the strengths of your products and services.

Broad understanding of the client situation: environment, challenges and requirements.

Marketing supports sales, and the two are aligned. Marketing ensures that both the client and the seller are informed. Marketing generates leads for sales.

Both are integrated and fully designed to match the client’s buying process. As well as generating leads for sales, marketing is also responsible for the conversation with the client and increasing engagement with the client target audience.

We recently had a visit from the American research bureau, CSO Insights. This company develops benchmarks for how best to utilize employees, processes and technology to optimize sales. It surveys over 1500 organizations all over the world every year to support this development.

The survey repeatedly concludes that companies with formalized sales processes work their way up to being a strategic adviser far more than companies that adopt a more ad hoc approach to sales. Best-in-class companies also ensure that these processes are flexible. If these results don’t sound valuable to you, then you must be one of the 33% of large companies that already use a formalized and flexible sales process.

A company with processes such as these is constantly monitoring how its salespeople are using them. They receive feedback so the processes themselves are adapted when there are radical changes in the market: new competitors, altered legislation, changing economic climates, and so on.

Well-organized for better results

It’s easy to predict that well-organized companies will achieve better results. The differences are very evident. Well-organized companies score better in all areas: more sales people achieve their targets, better execution of the sales plan, more deals are won, fewer customers delay projects, and a much lower churn rate.

source: CSO Insights 2013

This last point speaks for itself, as CSO Insights agrees: where would you prefer to work? In an organization where leads have a much greater chance of success, or where you have to be satisfied with a lower success rate? For an organization that always have to fight for attention, or for a company that customers consider to be a valued adviser?

This becomes even more important the more the market picks up, warns CSO Insights: sales people that can rely on a reliable team, tried and tested processes, and who feel certain they will be well received by the customer are much less likely to respond to a telephone call from a headhunter.

Fortunately, it’s never too late to climb to a higher level. CSO Insights gave the example of Fairchild Semiconductor, who in the space of just one year rose to the highest level, and saw its profit margin increase by 7%.

The customer is interested but the criteria for making decisions keep changing.

You sound out prospective customers for information – such as their current way of working and associated challenges – so that you can design your sales pitches accordingly, but they don’t bite.

You work with the same contact person throughout the entire sales process, and they are really interested, but suddenly replaced by a reluctant colleague in the final stage.

You have to send several quotes for the same sales opportunity

A deal gets called off just before it’s concluded. Subsequent inquiries show that the customer never even made a purchase order request.

Perhaps in all the above cases you are the victim of your own sales processes, which don’t take the customers’ readiness to buy into account. Too many companies fall into this trap, often lured by companies selling marketing techniques, training courses, CRM and marketing automation, consultants and software suppliers. They did a one-off analysis of a buying cycle, which was then converted into a sales process and uniformly applied to all customers and sales opportunities.

Navel-gazing leads you down a dead end

People who use sales processes as their guide instead of the customer’s buying cycle often find themselves down a dead end. This is just plain logic, because you are ignoring the customer’s reality in favour of your own reality. But it’s the customer who ultimately decides if and how much to buy.
You’re also asking your sales and marketing departments to convert all their external interactions into a linear and company-internal process. This never corresponds with the customer’s situation, by definition.

Briefly consider the following (and perhaps decide to get rid of the sales process):

There’s no such thing as one sales process for every sales opportunity. Each individual has their own dynamics and insights.

A sales process shifts the focus from the customer to the seller. A lack of focus on the customer leads to the right actions being taken, but at the wrong time.

Sales-oriented processes don’t offer any scope for sales to adapt their speed and communications to the customer, or to coach the customer according to their situation.

Someone who assumes their own processes can rarely make an accurate forecast: they only consider their own logic, and not the customer’s readiness to buy.

Copernican revolution

Another way is possible. There are models and tools that focus on the customer’s buying cycle rather than the sales cycle. Scientific research has shown that everyone goes through the same mental phases for every decision we make. It’s a mental phase that is not related to gender, age, job or nationality. Placing these mental phases in a model enables us to make this buying cycle predictable and so design a company’s actions to match it.

Sellers more important than ever

In this new model the role of the seller is more important than ever before. Every customer has their own way of indicating which phase they are currently in. The more important the purchase for the company, the longer the decision-making process can be expected to last. Only sellers who can correctly detect the buyer readiness of everyone in the buying cycle will conclude the majority of sales opportunities successfully. Because they are keeping their finger on the pulse, everything will run smoothly, as long as the customer allows. This doesn’t just improve your win ratio; it also keeps the buying cycle as short as possible.

Lower sales costs

So get rid of your sales process as quickly as possible and change your way of working, reporting and coaching to match the individual buyer readiness of all concerned. And sell more at a lower sales cost.

Trusted advisor

More than 41.000 employees in Sales, Marketing, Product Development and Management have already enhanced their performance with Perpetos. We have implemented Sales support solutions for dozens of local and multinational companies like Atlas Copco, Proximus, CH Robinson, Continental and Panalpina.

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Challenge us to enable your business to grow up to 17% faster. Get in touch today: call +32 2 410 11 00 or send a meeting request on customer@perpetos.com